GOP Senator Introduces Bill to Bar TSP Investment in China
A roundup of pay and benefits news.
Sen. Tommy Tuberville, R-Ala., on Tuesday revived a debate over how federal workers should be able to invest their retirement savings, introducing a bill to block the agency that administers the Thrift Savings Plan from allowing participants to invest in a broader international index that includes Chinese corporations.
In 2017, members of the Federal Retirement Thrift Investment Board, which administers the federal government’s 401(k)-style retirement savings program, voted to switch the index upon which the TSP’s international (I) fund is based to a more comprehensive one that encompasses more than 50 countries, including China and Canada. Despite pressure from Senate Republicans in 2019, the board voted to reaffirm its decision.
But last year, President Trump ordered the agency to halt its plan to switch to the new market index and nominated replacements for the three FRTIB positions that can be chosen without consultation with House and Senate leadership, prompting concern among some about politicization of an agency whose primary duty is a fiduciary one. As a result, the board voted to postpone implementation of the new index until new members could be confirmed by the Senate and longtime board chairman Michael Kennedy resigned.
Although Trump nominated three new members of the board, they were never confirmed.
Tuberville's Prohibiting TSP Investment in China Act (S. 1665) would block the Thrift Savings Plan from investing in “any security of a Chinese company,” according to a press release announcing its introduction.
“We’ve seen it time and again—Chinese companies don’t play by the rules, committing intellectual property theft and disregarding basic regulatory standards at the expense of investors,” Tuberville said in a statement. “Not a single taxpayer dollar should be invested with these entities that have a clear history of corruption. Such investments put the investors, and our country, at risk.”
Officials with the TSP declined to comment on the legislation, citing the fact that the text of the bill is not available to review. But officials have responded to past efforts to block TSP investment in Chinese markets by noting that the question of whether a market is safe for American investments falls under the purview of the Treasury Department’s Office of Foreign Assets Control, not the TSP.